Business and Travel Expense Policy

POLICY TITLE:

Carnegie Mellon University Business and Travel Expense Policy

DATE OF ISSUANCE:

This Policy was approved by the President on September 12, 2018 and applies to all business and travel expenses incurred and/or expense reports submitted on or after October 1, 2018. This Policy supersedes the 2011 Business and Travel Expense Policy.

ACCOUNTABLE DEPARTMENT/UNIT:

Office of the Vice President for Finance and Chief Financial Officer. Questions about the content of this policy should be directed to the Controller’s Office at ext. 8-5158

ABSTRACT:

Carnegie Mellon will pay for or reimburse university business and travel expenses that comply with this Policy.

I. Policy Statement

This Policy addresses business and travel expenses for university employees and non-employees, such as students and visitors who are directly paid with university funds (e.g., discretionary accounts, federally and non-federally funded external sponsorships and programs, purchasing card, etc.) or reimbursed by the university to individuals who incurred them for university business.

II. Who Should Read This Policy

Employees who incur business and/or travel expenses on the university’s behalf

Employees who supervise employees incurring university business expenses

Employees who make travel and other arrangements, prepare expense transactions or approve expenses for:

University employees

Prospective university employees

University visitors

Students who travel on approved university business, university-sponsored conferences, seminars or events

Non-employees (e.g., visitors, recruits, independent contractors, consultants and students) who travel or incur expenses relating to university business for which the university has agreed to pay

III. Reporting Requirements

This Policy adheres to IRS accountable plan rules that require employees and non-employees to properly document and account for all business and travel expenses, advances and allowances. The accounting must include:

Proper justification to establish a valid university business purpose for the travel or business expense, which must include the who, what, when, where, why and/or how for all expenses

Substantiation of the business or travel expense with required original receipts for all expenses of $75 or more

Return of any excess reimbursement or allowance within a reasonable time period

Identification and separation of expenses for alcohol purchases.

Requests for reimbursement of expenses should preferably be submitted within 30 days. Requests for reimbursement of expenses must be submitted and approved within 90 days after completing the travel or incurring the relevant expenses. Otherwise, the reimbursement, if approved, is typically taxable to the individual.

IV. Roles and Responsibilities

Primary responsibility for compliance with this Policy rests with the individuals requesting reimbursement or incurring the business or travel expenses and the departments and supervisors authorizing and approving the business and travel expenses. The responsibilities are:

A. Individual Incurring the Expense

Individual incurring the travel and/or business expense and requesting the reimbursement ensures:

The expense incurred has a valid university business purpose.

Proper business justification and supporting documentation (e.g., receipts) is obtained and/or provided to the business expense preparer.

Expense reports are prepared and submitted in a timely manner.

The required approval for upgrades and exceptions is obtained and provided to the expense preparer.

A valid Oracle account number(s) is provided to allocate the expense.

The expense complies with this Policy and, if applicable, complies with all sponsor requirements and/or federal regulations, the Relevant Documents listed for this Policy and/or departmental guidelines.

This individual may delegate responsibility for preparation of the expense transaction, but in doing so, retains responsibility for the validity and accuracy of the business expense.

B. Business or Travel Expense Preparer

The individual responsible for preparing the business or travel expense transaction and submitting the expense to the appropriate approver confirms:

The expense report accurately reflects trip and expense details as reported by the requestor.

Proper business justification and supporting documentation (e.g., receipts) are received from the individual requesting reimbursement or incurring the business or travel expense.

Mileage and per diem calculations are accurate (e.g., mileage reimbursement rates may differ for relocation expenses and business travel expenses).

Required approval for upgrades and exceptions is obtained and submitted by the individual requesting reimbursement or incurring the business expense.

The expense is properly allocated to the correct Oracle account number(s).

C. Business or Travel Expense Approver

The individual responsible for approving the business or travel expense transaction and verifying that:

The expense is properly allocated to the correct Oracle account number(s) and funds are available for the expense.

The expense complies with this Policy and, if applicable, complies with all sponsor requirements and/or federal regulations, the Relevant Documents listed for this Policy and/or departmental guidelines.

He/she is the appropriate approver for the requesting individual, budget and expense.

D. Designated Departmental Finance Representative (DDFR)

The DDFR may approve permitted exceptions to this Policy. The DDFR must be designated by the department, college and/or division. The Finance Division must be notified of the designation and will maintain the DDFR listing [pdf]. Exceptions may also be escalated to the president, the provost, the department’s dean or a vice president. Exceptions to this Policy should be documented and submitted in the appropriate manner given the purchase method.

V. General Guidelines for Incurring University Business and Travel Expenses

Business and travel expenses incurred for university business that are documented and comply with this Policy and, to the extent applicable, the relevant sponsor requirements and/or federal regulations, Relevant Documents and any department guidelines may be paid and/or reimbursed, but university business and travel expenses should be kept to a minimum.

Business and travel expenses (including amounts allowable as per diems) that are reimbursed following IRS accountable plan rules are not included in the individual’s income for U.S. federal personal income tax purposes or subject to employment taxes (e.g., social security taxes).

When expenses do not comply with this Policy and, to the extent applicable, the relevant sponsor requirements and/or federal regulations, Relevant Documents and any department guidelines, the individual requesting reimbursement may not receive reimbursement. If reimbursement is approved, the individual will receive a taxable reimbursement of those expenses.

Expenses that may be reimbursable business or travel expenses per this Policy may be unallowable for federal, state or other sponsored reimbursement, either directly or indirectly. Questions about the sponsor requirements should be directed to the department’s business manager, DDFR and/or Sponsored Projects Accounting in advance of incurring the relevant expense to ensure the expense is allowable for federal, state or other sponsored reimbursement, either directly or indirectly.

All expenses must have a valid university business purpose that supports the university’s mission. Personal expenses, as well as any incremental travel expenses incurred for personal business during a university business trip, are the responsibility of the traveler, not the university. The university will not reimburse or pay for expenses inherently personal in nature. Receiving reimbursement for or payment by the university for personal expenses is not permitted and may result in disciplinary action and/or termination. For examples of personal expenses, refer to the Business and Travel Expense FAQs and/or contact the Controller’s Office.

The university will not pay for or reimburse business or travel expenses that have been or will be reimbursed from third-party sources other than expenses for which the university will be reimbursed under agreements.

Departments govern how authorization for business and travel expenses is granted. Departments may elect to impose additional restrictions over expenses beyond those required by this Policy for various business reasons, including budget availability. For example, it is up to the department’s discretion to determine what types of business relocation/moving expenses may be paid for or reimbursed.

The university will not provide travel advances, pay directly or make reimbursements for the business and/or travel expenses of companions/spouses or non-employees who accompany faculty or other employees on university business, except in limited circumstances when authorized in advance by the president, the provost, the department’s dean or the relevant vice president. Approved reimbursements may be included in the income of the recipient for U.S. federal income tax purposes or subject to required withholdings and employment taxes, except when the companion/spouse or other non-employee’s presence has a bona fide business purpose and the individual substantiates the expense.

Preferred suppliers should be utilized to arrange and pay for university business expenses and/or travel as they are able to direct bill the university, eliminating the need for the individual incurring the expense to pay personally and subsequently be reimbursed. Procurement Services maintains the supplier directory, which includes those vendors selected as preferred suppliers.

Purchases with personal funds for goods in excess of the micro-purchase threshold of $3,000 and/or all services, regardless of dollar amount, should be reviewed with Procurement Services prior to purchase. Please refer to the Purchasing Policy for additional guidance.

As a nonprofit organization the university has been granted exemption from state sales tax on the purchase of certain goods and services in certain states. For a purchase to be exempt from sales tax, the business purchase must be made directly with university funds for a university exempt business purpose and the university’s sales tax exemption number or certificate must be provided to the vendor at the time of purchase. Therefore, goods and services should be procured through the university’s purchasing methods whenever possible. Sales tax incurred for purchases made with personal funds for university business travel or for university business meals will be reimbursed. The sales tax exemption does not apply to, for example, hotel occupancy taxes, the Allegheny County alcohol beverage tax, sales tax in some states, sales tax for purchases other than for a university exempt business purpose (e.g., a purchase for an unrelated trade or business) and taxes in locations that are outside of the United States. To obtain a copy of the university’s sales tax exemption certificate or for additional information or questions regarding sales tax, please visit the Taxation website.

Reimbursements for any approved business relocation/moving costs are included in the income of the recipient for U.S. Federal income tax purposes and subject to employment taxes.

Individuals incurring business and travel expenses must adhere to all other university and/or departmental policies, guidelines and requirements (e.g., purchasing policies) governing the relevant expenses.

Employees and other individuals incurring expenses for university business at one of the university’s non-U.S. branches or locations may have different personal income tax consequences than that specified in this Policy. Similarly, employees and other individuals incurring expenses for university business at one of the university’s U.S. branches or locations may have different or varying state and/or local personal income tax consequences for travel and expense reimbursements.

Business and travel expenses are allowable and reimbursable as specified in this Policy, subject to these General Guidelines.

VI. Business Travel Expenses

Travel vendors/suppliers identified by the university as preferred are familiar with the university’s travel program, provide support to travelers and should be utilized whenever possible. Travelers must use a personal credit card, check or cash when making business travel arrangements without utilizing one of the university’s preferred travel agencies. Reimbursement for travel purchases made with personal funds should be made only after proof of payment is submitted with the expense report.

The following university business travel expenses are permissible and reimbursable as outlined below:

A. Commercial Air Transportation

The Fly America Act states federal awardees and others performing federal government air travel between the United States and a foreign country must use U.S. air carrier service for all air travel and cargo transportation services funded by the U.S. government. The practices specified by the Fly America Act may differ among federal agencies. Accordingly, individuals whose travel will be charged to a federal grant or contract should consult the relevant agency guidelines and the Fly America Act website.

The class of air travel chosen should be the lowest-priced coach airfare ticket available using a commercial discount or standard accommodations. The university recommends that tickets be booked at least 21 days in advance.

For airline tickets funded by a sponsored award, the individual traveler should consult the relevant sponsor requirements in advance of booking to ensure the relevant expense for the cost of the airfare booked may be reimbursed under the sponsored award.

Premium (e.g., first class, business class) fares may be an appropriate business expense subject to budget availability and when permitted by the relevant sponsor requirements (as applicable) and approved by the president, the provost, the department’s dean, vice president or DDFR. Subject to the foregoing, business class fares may be appropriate in the case of overnight “red-eye” flights or flights exceeding eight continuous hours.

Travelers may personally retain frequent flyer plan rewards or other bonuses that may accrue from business travel. However, in no case may the traveler choose a reservation at a higher cost in order to accumulate additional plan rewards or other bonuses. In addition, the university will not purchase frequent flyer miles from travelers or reimburse them for tickets purchased with frequent flyer miles.

Airline charges for checked and/or carry-on baggage when traveling on university business are reimbursable business expenses. Excess baggage expenses are reimbursable in any of the following circumstances:

Traveler is transporting university materials.

Traveler is on an extended period of travel.

Department expense approver has approved the additional charges.

Reimbursement requests for an upgrade for seats, advanced seat selection fees, premium boarding, etc., must include a description supporting the business purpose. Any upgrades $75 or greater must be approved by the DDFR.

Expenses $75 or greater incurred for early departure or late return must be approved by the DDFR.

B. Private (Non-Commercial) Air Transportation

Private (non-commercial) air transportation, whether owned or chartered, is not a permitted method of business transportation, unless approved in advance by the relevant department head, and the pilot/aircraft (or charter company, as applicable) has met, in advance of the relevant travel, the requirements of Insurance Services. In these circumstances, the university will only reimburse for travel that is solely for the purpose of conducting university business and, unless the president or provost authorizes otherwise, at the lower of (i) the ordinary and necessary costs of the aircraft’s flight, or (ii) the verified equivalent coach ticket price. Reimbursement will not be provided for any flight that includes passengers who are not traveling for the same university business purpose as the pilot. Any additional insurance-related expenses incurred by the university in connection with any private (non-commercial) air transportation must be paid by the relevant department approving the transportation.

C. Rail Travel

Rail travel is also an allowable method of business transportation. The class of rail travel chosen is expected to be the lowest-priced coach rail ticket available. Premium (e.g., first class, business class) fares may be an appropriate business expense subject to budget availability and when permitted by the relevant sponsor requirements (as applicable) and approved by the president, the provost, the department’s dean, vice president, or DDFR. Any upgrades $75 or greater must be approved by the DDFR.

D. Personal Automobiles

The use of personal automobiles for university business is allowable. The university will only reimburse for use of a personal automobile for university business at the mileage rate published annually by the IRS. This mileage rate is set by the IRS and includes costs for standard maintenance, repairs, taxes, gas, insurance and registration fees. Therefore, aside from reimbursing mileage at the mileage rate published annually by the IRS, the university will not reimburse for personal automobile expenses such as maintenance, repairs, taxes, gas, insurance and registrations fees. Loss or damage to a personal automobile and related costs (e.g., insurance deductible or claim, towing, storage, etc.) is also not reimbursable. Individuals requesting reimbursement or incurring the expense who are based at university campuses or locations outside of the U.S. may be required to adhere to country-specific mileage rates and should consult their local business office with questions. Tolls and parking fees incurred while using a personal automobile for university business are also reimbursable, but parking tickets are not.

E. Ground Transportation

Ground transportation is appropriate to the extent that such a service is necessary for business purposes. This includes transportation to and from airport, rail depot, hotel and/or location of business meetings. Tips are permissible.

F. Rental Vehicles

When required for university business, employees or students should arrange domestic and international vehicle rentals through the university’s preferred suppliers using the university’s business program codes available through Procurement Services, when applicable, as the codes provide access to pre-negotiated rates with these suppliers. In addition, for domestic (U.S.) rentals, the pre-negotiated rates with these suppliers often already include certain levels and types of insurance coverage, such as a negotiated level of liability insurance coverage for injury to a third party and physical damage to the rental car. The traveler should be prepared to provide a university ID and driver’s license upon pick-up of the rental car.

Standard vehicles are the recommended vehicle size for rental purposes. Upgrades to full-size cars are permitted when this does not result in additional charges to the university (e.g., free upgrade) or the upgraded vehicle is needed for university business purposes. Upgraded vehicles may be an appropriate business expense subject to budget availability and when permitted by the relevant sponsor requirements (as applicable) and approved by the president, the provost, the department’s dean, vice president, or DDFR. Any upgrades $75 or greater require DDFR approval and a detailed explanation (e.g., number of persons, luggage accommodations, etc.) must be included in the business justification. Aside from providing a valid business justification, rentals of luxury or high-performance vehicles, as well as motorcycles, moped, boats or jet skis, require pre-approval from both the DDFR and Insurance Services (since the university does not maintain insurance for these rentals). Rental of vehicles that require a commercial driver’s license to operate similarly need pre-approval from Insurance Services before the rental is arranged.

Bicycle rentals for business transportation are reimbursable.

Costs for fuel will be reimbursed.

Parking costs and toll fees (including rental of a toll fee transponder) are reimbursable. Parking tickets are not reimbursable nor are any costs associated with towing and impound fees for parking violations.

Additional costs, such as GPS/navigation, satellite radio, child car seats or ski/bike racks, are reimbursable with DDFR approval and a valid business justification.

Roadside protection coverage is not reimbursable, but costs for rental car breakdown and towing are permissible and reimbursable.

If the vehicle is not rented with a preferred supplier using the university’s business program codes, the traveler has the option to purchase insurance coverage for liability and/or comprehensive and collision damage to the rental vehicle (often referred to as Loss Damage Waiver (LDW) or Collision Damage Waiver (CDW)) at the time of rental and will be reimbursed.

Personal accident and personal effects insurance coverages are not reimbursable.

Travelers renting a vehicle for university business who are not employees or students on university business (e.g., visitors, guests, recruits, consultants, etc.) cannot use the university program codes. Costs for purchasing insurance coverage through the rental company for liability and/or comprehensive and collision damage to the rental car (LDW or CDW) are reimbursable. Other than costs for purchasing such insurance, costs related to injury, loss or damage caused by or to the rental car are not reimbursable.

Business program codes may not be available for all international rentals. In such cases where business program codes are not available, insurance coverage should be purchased to cover damage to the rental vehicle and the auto liability limit that is legally required in all places where travel is planned. Travelers should be familiar with prevailing license and driving rules prior to renting a vehicle outside of the US and should use established, well-known car rental companies.

There is inherent liability associated with signing a vehicle rental agreement and operating a vehicle. All renters/drivers are required to follow the law and the terms of their vehicle rental agreements and Insurance Services requirements/guidelines in order to avoid and/or minimize personal liability and/or additional (unanticipated) departmental charges in connection with the operation and rental of the vehicle for university business and to ensure that any associated university insurance may be available to pay any related claims.

For example: (i) the driver/renter is responsible for adhering to all of the terms and conditions of the rental car agreement and is personally responsible for any loss or damage, fines, penalties or other consequences caused by the driver/renter’s failure to adhere and (ii) costs not covered by insurance provided by or purchased from the rental car company and/or university insurance will be borne by the renter/driver or department authorizing the travel, as applicable.

Insurance Services can provide specific guidance on purchasing insurance coverage(s) offered by the rental company for a given circumstance and/or provide information about university insurance coverages. Insurances Services may be contacted at Insurance-Services@andrew.cmu.edu.

G. Lodging Expenses

The university will direct pay or reimburse a traveler for the single occupancy cost of a standard room incurred during university travel. Travelers must submit an itemized paid receipt for reimbursement of their lodging expenses so that the room rate, taxes and other expenses can be identified and recorded appropriately. Lodging expenses are also allowable via per diem for university employees. Employees should consult sponsor requirements and/or federal regulations prior to incurring lodging expenses.

H. Meals (per diem or actual)

Travelers can be reimbursed via per diem (employees only) or based on actual costs incurred for their own meals while away from home. Per diem is only allowed for employees travelling on trips that that require overnight lodging. Actual costs are reimbursable for single day trips or trips that require an overnight stay for employees and non-employees.

The university will reimburse travelers for costs of their own meals incurred during the time they are away from home.

Employees can choose to be reimbursed via per diem or actual cost for meals, but are only permitted to request one reimbursement type for the entire trip.

Non-employees can only be reimbursed for actual costs incurred for meals.

Per diem reimbursement is not available for student employees who are being reimbursed for academic expenses not related to their employment.

Travelers are expected to incur no additional cost for meals that are provided as part of a fee for attendance at conferences, workshops, hotel costs, meetings, etc., or provided as part of a business meeting or by an airline while en route to their destination. When meals are provided, the daily meal per diem must be reduced accordingly. If there is a business justification provided regarding dietary restrictions that cannot otherwise be accommodated, the traveler may be reimbursed.

U.S. General Services Administration (GSA) periodically revises the per diem rates based on the costs of meals. Employees must use the per diem rates in effect at the time of travel for the location of travel as listed on the GSA website.

Per diem calculations for the first and last day of travel must be calculated utilizing the method as defined on the GSA website, in which the traveler can request 75 percent of per diem for the first and last day of travel in their applicable destination city.

Departments may require reimbursement based on actual expenses with receipts in lieu of per diem based upon departmental specific policies and procedures (including for budgetary purposes).

Departments may elect to reimburse employees for amounts below the GSA per diem rates. Per diem reimbursement may be limited or prohibited by the relevant sponsor requirements (e.g., the sponsored award or contract, grant, federal regulations, etc.).

A per diem reimbursement cannot be provided if the employee will not incur expenses for meals (e.g., if meals are provided by the applicable conference or business meeting).

Employees at one of the university’s non-U.S. branches or locations may be required to adhere to country specific per diem rates and should consult their local business office and/or International Finance with questions.

Employees who are eligible to receive per diem reimbursement need not submit receipts for the meals covered by a per diem but must submit documentation (e.g., airline and conference itineraries) confirming their travel dates.

When travel is expected to occur for more than 30 consecutive days in one location, or when the circumstances of the travel are such that the traveler can be expected to incur expenses comparable to those arising from the use of establishments catering to the long term visitor or from the use of non- commercial facilities, the traveler may be reimbursed either for the actual costs incurred or with per diem allowance equal to 60 percent of the standard rate for the appropriate geographic area. The reduced rate begins with the first day of travel.

I. Foreign (non-U.S.) Travel

Foreign travel is a reimbursable university business expense, but may require prior sponsor approval and/or may be limited by sponsor requirements (if the travel is expected to be funded through sponsored reimbursement).

All university policies pertaining to travel apply to foreign travel.

The U.S. State Department maintains a list of countries for which travel advisories have been issued. The State Department’s website for travel advisories is http://travel.state.gov.

The university’s Global Export Compliance Team (GECT) should be contacted at export-compliance@andrew.cmu.edu prior to foreign travel to obtain guidance on exports of information, technology, equipment and/or other materials that will be hand carried by the traveler. GECT provides international travelers with travel letters to facilitate getting through customs and as a preventative measure against confiscation of laptops, equipment and/or materials by any customs agency. When traveling to countries that are sanctioned by the U.S. government, international travelers should contact GECT for a travel briefing and special instructions. Review http://www.cmu.edu/research-compliance/export-controls/ for detailed guidance on international travel and compliance with U.S. export regulations.

For travel to and from Qatar, travelers must arrange their travel (and obtain related approvals) through International Finance by contacting qartravl@andrew.cmu.edu.

J. Travel and Healthcare Insurance

Travel and healthcare insurance coverages are available. The university provides business travel and accident coverage for full time faculty and staff under age 80 on university approved and directed business travel. Specific questions regarding the university’s business travel and accident insurance coverage should be directed to Human Resources and/or Insurance Services. Travelers should consult Human Resources at least 30 days prior to any planned travel regarding healthcare insurance. The traveler should also consult with Insurance Services for travel to sanctioned countries as this travel may be limited or excluded under some university insurance policies.

K. Miscellaneous Travel Costs

These costs are reimbursable if itemized and documented in accordance with this Policy and if permitted by sponsor requirements (if the costs are expected to be funded through sponsored reimbursement). These may include, but are not limited to:

Parking

Business telephone calls using personal devices while traveling when in excess of the employee’s communications allowance, if applicable, as well as phone calls home

Hotel internet service fees

Passport and visa fees, if specifically obtained to perform work for the university

Currency exchange fees

Laundry and dry-cleaning charges after completing five consecutive days of business travel

L. Travel Advances

Travel advances may be available for employees traveling on authorized university business to cover miscellaneous costs, such as per diem, taxi fares, tips and other business expenses. The DDFR may implement additional processes or limit travel advances. Advances will not be provided earlier than 10 working days prior to departure and will not be granted to employees who have an outstanding prior travel advance unless the president, the provost, the department’s dean, a vice president or the DDFR certifies that extenuating circumstances warrant the second advance. Travel advances are cleared through the submission of expense reports, which should typically be done within 30 days of completing the travel. If expenses are not submitted within 90 days after completing the travel, the IRS requires the university to report these payments as taxable income to the employee.

VII. Business Meals and Entertainment

A. Business Meals for Employees Only

Employee meals are reimbursable business expenses when the primary purpose of the meal is to meet to conduct university business with a formal agenda and when there is a need to meet over the meal. These requirements are met when it is not possible for one or more employees to meet during working hours due to scheduling conflicts (e.g., when travel plans or other business meetings conflict with available meeting times for parties involved).

The name(s) of the attendees for meals with five or fewer employees must be documented for reimbursement. For meals with more than five attendees, the total number of employees in attendance should be documented.

B. Business Meals with Non-University Personnel

These meals are reimbursable business expenses when the purpose of the meeting is to conduct university business and when it is necessary or appropriate to have the meeting with a meal.

The name(s) of the meal attendees for meals with five or fewer individuals must be documented for reimbursement. If the attendees are not university employees, their affiliation with the university should be provided as well. For meals with more than five attendees, the total number of attendees should be documented.

C. Occasional Employee Banquets and Functions

These events are reimbursable business expenses when the function is intended to serve as a token of appreciation that primarily promotes employee relations/morale (e.g., holiday or retirement parties) or to recognize individual or group achievements.

Occasions that are inherently personal in nature (e.g., parties to celebrate births or marriages) or small in-office functions with purchased food or beverages are generally paid for by the employees involved and are not typically considered reimbursable business expenses.

D. Alcohol

Alcohol served in conjunction with employee banquets, functions or business entertainment may be considered a reimbursable business expense when the banquet, function or business entertainment is primarily intended to promote employee relations, such as receptions, holiday parties, etc. Alcohol cannot be charged to a federal grant or contract (either directly or indirectly). Alcohol costs must be charged to the unallowable object code/expense type and to a non-federal account. Alcohol and tobacco cannot be charged/expensed at some non-U.S. campuses or locations. Individuals should contact their applicable department to determine if restrictions apply. Alcohol expenses in conjunction with business entertainment are reimbursable when deemed appropriate by the expense incurrer’s DDFR, the department’s dean or a vice president.

E. Meals and Functions

Meals and functions are considered business entertainment and are reimbursable if they are intended to provide hospitality to non-university personnel that is necessary and customary in furthering the university’s business. Examples include:

Meals and functions that include companions, spouses or guests who are not directly involved in conducting university business are indications that the meal or function is entertainment rather than a business meal or meeting.

A list of names for five or fewer attendees should be documented for reimbursement. For a group of more than five attendees, identification of the host group and total number of attendees should be documented for reimbursement.

Because entertainment expenses are rarely allowable as either direct or indirect costs of federally sponsored grants and contracts, these costs must be segregated and charged to either an unallowable object code/expense type or recorded appropriately to ensure that the amount is excluded from any calculation of direct or indirect sponsored project costs.

VIII. Other Business Expenses

Other types of business expenses that are permissible when related to university business may include, but are not limited to:

A. Professional Development Expenses

Expenses such as registration fees for conferences, seminars, webcasts, etc.

B. Memberships, Dues, Subscriptions and Certifications

Expenses such as fees for individual memberships in business/professional associations, fees for magazine, newspaper or newsletter subscriptions and/or other costs incurred to maintain professional certifications or licenses that are directly related to the employee's job responsibilities at the university.

C. Gifts

Gifts may occasionally be given to an individual and paid for from an appropriate university funding source. Non-cash gifts with low monetary value may be given to employees as a gesture of goodwill or appreciation, for work-related achievements, length of service awards, as part of employee morale building events or due to an illness, death in the family or family crisis. To be reimbursable, the gift expense must meet all of the following criteria:

The aggregate value of the gift is $75 or less.

The gift is not provided on a routine basis.

The gift is not provided in the form of cash or cash equivalents (e.g., cash, check or gift card)

Length-of-service award expenses may exceed $75, but must meet the following criteria:

The recipient must be in active service on their anniversary date to receive the length-of-service gift.

Gifts may not be made until the end of the employee’s fifth year of service and not made more frequently than every five years.

The value or cost of the gift should not exceed $400.

The gift must be in the form of tangible personal property. Tangible personal property does not include cash, cash equivalents (e.g., gift cards or gift certificates), vacations, meals, lodging, theater tickets, sporting tickets, stocks, bonds and other similar items.

The gift must be presented as part of a special event or celebration that marks the occasion, such as a departmental meeting.

Gifts paid for by the university that do not meet the above criteria for non-cash and/or length of service awards, must be included in the gift recipient's W-2 as taxable wages for employees and in the gift recipient’s 1099 for non-employees. Per IRS regulations, all gifts provided in the form of cash or cash equivalents (e.g., gift cards) are taxable in any amount. Individuals should ensure that all necessary forms and documentation as required are properly completed.

D. Recruiting Expenses

Recruiting expenses (e.g., meals, travel or gifts) are reimbursable, but may be subject to department-specific policies and procedures.

E. Miscellaneous Business Expenses

These include, but are not limited to, cancellation fees due to extenuating circumstances, postage, supplies, photocopying charges and parking for external meetings or trainings.